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Mr Adithya is the newly appointed vice president, operations of thrishna international, and Fmcg Company having some 40 active

brands. The products of the company are available in available in about one lakh retail shops, which are catered through the 200 regional warehouses. As he was assigned with the task of increasing profit of the company by 5% over a period of two years , Mr Aditya analysed the different facets of operations with keen desire, he found that all the fifteen plants of the company enjoy enviable record of prompt execution of orders so it was sheer surpirise to him that the stock level ar the warehouses accumulate up to 90 days sales. Also he found that cross trucking among the warehouses are very common in the company and that accounts for about 10% of the sale. Also he noticed that more than 15% of the total dispatches are in partial loads .another interesting fact was the retailers habit of making bulk purchase that is about 30 days sales .Mr Aditya feels these findings really contradicting and is confused.

As a consultant help mr adithya to identify the problems and the areas of improvement suggest a suitable course of action to solve the problems to tap the opportunities

The case shed light in to the problem faced by Thrishna International. The Vice President is assigned to increase the profit of the firm by 5% over a period of two years. All the fifteen plants of the company are prompt to execution of orders. Accumulated stock level is up to 90 days sales.

Cross trucking costs 10%of the sales.

15% dispatch are in partial loads.


Retailers order in bulk in about 30 days sales

The readiness to fulfill the order promptly and warehouses accumulating for 90 days sales indicates the production is in the form of Make to stock Cross trucking indicates that the firm doesnt have a forward placement where the stock is closer to a customer (here retailer) from warehouse or distribution center.

Either we should move to Make to order production method so as to avoid the excess inventory holding. As the retailers are in a habit of taking bulk orders every 30 days we can use Assemble to order technique so as to avoid excess inventory holding hence saving the opportunity cost for storage when the firm could use that space productively in some other way.

Assemble to order also helps to the partial dispatch of the finished inventory. Cross trucking can be avoiding by implementing forward placement.

Forward placement can have two advantages i. Fast delivery items ii. Reduce transportation costs

A financial measure of a company's performance that gives investors an idea of how long it takes a company to turn its inventory (including goods that are work in progress, if applicable) into sales. Generally, the lower (shorter) the DSI the better, but it is important to note that the average DSI varies from one industry to another.

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